Threatens to long-term sustainability of pension system in Romania

Starting 2007 Romania Insurance Budget registered rising imbalances of the budget due to consecutive spiky increase in pension benefit combined with an augmenting number of pensioners. The prospects regarding the pension expenditure on medium term were strongly affected by the financial and economic crisis: under the effect of automatic stabilizers and of the consecutives increases in pension values in the previous years, the social security costs (pensions, unemployment. minimum pension, social assistance) increased in 2010 up to a maximum of 9% in GDP. This situation will deteriorate in the coming decades taken into account the negative trend of the demographic projections, specifically the low birth rate, increase in life expectancy and consequently an accelerated ageing process.